Failure harms performance
Everybody knows, how a rejection or failure can bruise the ego, you get demoralized, your motivation diminuishes, we all know this. But failure also can have an impact to our lives that we are not aware of.
In an experiment people were asked to perform an intelligence test. Half of the group was given an unsolvable test.
When all of them were given a very basic test afterwards, an alarming number of the ones who had "failed" before, were not able to solve the very easy questions they were asked. They overestimated the difficulty of the task and they underestimated their knowledge that they had, it was not accessable for them, they could not make any use of it. This is something unconscious.
Failure can distort peoples perception of their goals and also the perception of very fundamental basic abilities.